Making America safe for the Democratic Party

On the Road to Serfdom Again

By BRADLEY J. BIRZER

In 1944, Austrian economist Friedrich August von Hayek published a little polemic through the University of Chicago Press entitled The Road to Serfdom. No one, least of all Hayek himself, expected the book to explode in the manner it did, especially after Reader’s Digest chose to serialize it. Based in large part on observations first made by Alexis de Tocqueville, The Road to Serfdom did much to galvanize the Right, especially in America, giving it voice and, to a great extent, unity. Any power at war, Hayek noted in his book, should consider not only what the aim of the war is, but also what the postwar world should look like. Should the current Allied powers simply rehash the mistakes made by the Western powers after World War I, the efforts of World War II would amount to little good.

To begin to understand oneself, Hayek noted, one must understand the enemy as embodied in nationalism and socialism. Yet the so-called free Allied powers had only revealed “an inner insecurity and uncertainty of aim which can be explained only by confusion about their own ideals and the nature of the differences which separated them from the enemy,” Hayek lamented. Long before the current war, he continued, the Western powers had lost their understanding of liberty as “the basic individualism inherited by us from Erasmus and Montaigne, from Cicero and Tacitus, Pericles and Thucydides, is progressively relinquished.”Individualism, Hayek argued, had called for respect for the uniqueness of each individual person, each able to make choices, and each able to use his talents for the betterment of himself and his community. Slowly discovered throughout the Western tradition, such individualism had led to true progress. Now, Hayek feared, not only had the West lost its purpose, but it did not even know how to return to its foundations. Echoing Tocqueville, Hayek concluded that the West crept toward socialism, toward a soft or democratic despotism.
Hayek’s fears have proven prophetic as Leviathan has grown fiercely. The welfare state, at least 75+ years old in America, and the warfare state, now going on 70+ years, have each taken their toll on our society and culture. Lamentably, they have become habits for us Americans. When we want to reform some problem at home, we pass a law. When we want to reform some problem abroad, we send our troops—usually without congressional approval. Neither of these things is particularly constitutional, but they have become part of America over the past several administrations.

And it’s never as simple as mere welfare and warfare. Our government now nullifies the common law tradition, honed over a millennium, of being presumed innocent as the TSA Agents grope us. Our government sends armed men against farmers who do not pasteurize their milk. Our government spends endless amounts of money (much of it merely printed on whim) on businesses and banks “too big to fail.” Our government … well, you get the picture. And, it’s not a pretty one. Indeed, one must wonder, if Leviathan devours so much and becomes so bloated, at what point must it purge itself in the vomitorium? Sadly, there seems to be no such just end in sight. Instead, Leviathan just keeps going. It produces nothing, it ravages everything, and like a man in a public restroom, it fails to use the facilities properly.

As the ever-interesting Tom Woods makes clear in this new edited work, Back on the Road to Serfdom, the West no longer creeps toward socialism. It now leaps toward it.

Woods has put together an impressive ensemble of writers, and the book grabs the reader’s attention from its beginning to its end. After a brief introduction by Woods, Brian Domitrovic and Carey Roberts provide historical background to the current economic crisis and to the rise of Leviathan. While Americans experienced serious economic growth between the Civil War and the Progressive period, Domitrovic explains, the period following Progressivism has merely been one of “busy-ness” as the United States embraced the rule by “experts” through macroeconomic policies. “Macroeconomic policy, as much as any outright push toward collectivism, is on the record as putting us on the road to serfdom.”

Roberts, a great historian of the early American republic, examines the legacy of Alexander Hamilton in politics and economics. While few Americans looked to Hamilton for answers in the nineteenth century, seeing him as the antithesis of classical liberalism, progressives turned almost as one to his legacy in the 20th century as a means to explain their own ideas as rooted in the founding. Americans “championed Hamilton as a prophet of industrialization” as well the “architect of a financial Pax Americana.” Employing the symbol and spirit of Hamilton, they built a mighty nation, willing to control at home as well as abroad.

In a fascinating chapter that seems somewhat out of place in the book, economist Per Bylund explores the successes and failures of the Swedish welfare state. He notes, persuasively, that a number of unusual factors led to Sweden’s success in the 1970s and 1980s. If Bylund is correct, the success goes more to Sweden as a country and culture than it does to its welfarist economic system. Most importantly for Bylund, offering a theme that runs, explicitly and implicitly, through Back on the Road, Leviathan has also over time bred a new Swedish man—“immature, irresponsible, and dependent.”

At once spooky and prophetic, economist Antony Mueller’s chapter details the factors that led to our current economic and debt crisis. It also predicts what is to come. As do all of the economists in this book, Mueller writes so well that even an economic ignoramus and dunderhead such as myself not only understood but also, realizing the implications, trembled. Mueller succinctly expresses that, after Nixon removed the United States from the gold standard, “governments were not obligated to maintain currency rates within a fixed value in terms of gold, the demands of modern populist democracy produced a dynamic that drove toward the credit expansion and debt accumulation.” Driven by the democratic ethos, debt rapes an economy. “Unless central banks and governments recognize that the cure they are prescribing is actually the cause of our economic ailments—that, in fact, they are the cause of our problems—we will be subjected to ever more costly and repressive government interventions,” Mueller writes. “Leviathan will keep growing, and debt levels will keep exploding.  The current paradigm is simply unsustainable.”

Economist Mark Brandly proves rather definitively that tariffs always hurt consumers and overall economic production. As he explains it, tariffs serve mere political whims and rarely, if ever, protect the res publica. With the same clarity as Brandly, economist Dane Stangler demonstrates the critical function of the entrepreneur to an advanced economy, claiming that no matter how big “those too big to fail” are, the real growth comes from startup companies, which offer an unending supply of “renewal” and innovation. Unpredictable, the “messy reality of innovation has no place in the neat strategies set forth by the champions of national competitiveness.” Unable to plan for this most vital aspect of economic growth, bureaucrats, at best, ignore entrepreneurs and, at worst, crush them with administrative minutiae. In the following chapter, award-winning writer Tim Carney warns that one should not conclude that, consequently, big business reigns in America. If it does, it’s fettered big business, captured by the political and regulatory powers of the country. What results is a form of corporatism that rewards sycophancy and cleverness rather than insight and innovation.

Economist John Larrivee and philosopher Gerard Casey offer complimentary analyses in two of the final three chapters. Each argues that one of the greatest errors of the twentieth century was to overemphasize the economic and materialists aspects of man while allowing the political to crowd out civil, religious, and economic associations. Liberty, though, is of a whole. Should one aspect of liberty be attacked, all aspects of liberty will be affected. As an illustration, the freedom of the market does not lead to the corruption of virtue. Instead, the freedom of the market is related to the freedom of conscience. Should one be attacked, the other is as well. If one aspect is protected, the other benefits as well. Conversely, religion suffers severely when it turns over any of its rights and duties to the state. The state exploits this sanction of the religious body, vampirically draining the Church of its life.

As noted above with Bylund, one of the major themes of this book as a whole is the way in which economic interventionism changes the habits and character of a people. Most of the scholars writing for Back on the Road examine this idea, and they find, not surprisingly, that government interventionism harms not just the economy, but more importantly, the dignity of the individual and community. The more government expands, the more civil society and its habits disappear.

The ultimate chapter, strangely, sums up nothing, and many of the vital themes of the book flounder in disparate strands, abstractly begging to be made whole. Equal parts incongruous and quirkily engaging, Shakespeare scholar Paul Cantor considers the role of television as a cultural and political force during the 1960s. Under the fountainhead of John F. Kennedy and his so-called “New Frontier,” FCC Chair Newton Minow hoped to remake television not only as a means to bring serious culture to American homes, but also as a means to bring American values to the entire world. “Minow wanted television to do no less than bring peace and understanding to the world,” Cantor writes with characteristically wicked humor, “and to make it safe for democracy (or at least for the Democratic Party.)” As with all such experts, writes Cantor, Minow failed. Ultimately, Minow possessed what Hayek called the “fatal conceit,” the belief that what he held to personally was indeed truth. The end result of Minow’s efforts, Cantor claims, was not better TV, but less interesting TV.

The only real problems with this otherwise excellent book are its failure to address certain vital questions Hayek raised and its lack of a conclusion. None of the authors addressed one of Hayek’s most important points in 1944, the actual reasons for—and mechanics of—the breakdown and failure of democratic politics in Germany and other parts of Europe. As Hayek understood it, Nazism arose not from mere irrationality, as was often argued at the time, but instead from the inevitable failure of democracy. Parliaments, based on representation of different geographical areas, constituencies, and interests, divide and then unite a country through the vote, a consensus. Rather than haggle openly in front of the public and lose votes, politicians quickly learn to delegate increasing power to the bureaucracy, thus distancing themselves from criticism. Of course, such centralizing bureaucratic control destroys a democracy.

Bureaucracies, by their very nature, necessarily turn the individual into a “means” for the end of the social or general welfare of the political unity. Equally dangerous, the state must use its resources and institutions as propaganda, distorting the truth to convince the country of the rightness of its actions. The worst in society—the lowest common denominator, those who desire power—take control, holding all together through national conformity. Though Hayek later embraced democracy as a political system, the younger Hayek’s critique of democracy is deeply rooted in the Western tradition, finding its origins in Plato.

The most significant problem with the Back on the Road, though, is its lack of a conclusion. This book desperately needs one. Indeed, the reader deserves one. Woods’s introduction, while fine, is short, and the book needs a final chapter to pull all manner of things presented throughout its pages together. For an edited work, it is amazingly coherent without becoming repetitive. Still, its themes and connections—author by author and idea by idea—need to be brought together. And the future of America and the West needs to be addressed. What hope is there for a decentralized, humane, and civil society in the future? What will Hayek’s role be in creating (or theologically and Platonically, remembering) such a future? What can take us off the path to serfdom on which we now travel? Or, as one might rightly conclude after reading this book, is there no hope? Are we merely biding time until all collapses, praying a remnant might preserve what little truth we understand, as did St. Augustine with The City of God, for some future and remote people?

What is already a very valuable book might, with only a few changes, have become an indispensible book. But these minor criticisms should not detract from this necessary and noble work.